US Court Rules Trump's '10% Universal Import Tariff' Lacks Legal Basis

According to foreign media reports, on May 7 local time, a panel of the US Court of International Trade issued a ruling, determining that the 10% universal import tariff introduced by the Trump administration does not comply with legal provisions. This marks the second major setback for Trump's signature economic policy since 2026.

The core dispute of this ruling revolves around the application conditions of Section 122 of the Trade Act of 1974. This provision allows the President to impose tariffs of up to 15% on all imported goods without congressional approval, provided specific requirements are met. The court found the Trump administration's justification for invoking this provision to impose tariffs insufficient, noting that the relevant presidential proclamation did not mention a large-scale, serious US balance of payments deficit as defined by Congress.

The ruling requires the Trump administration to cease collecting the relevant tariffs from the plaintiffs in the case and to refund previously collected amounts. The ruling's effect is currently limited to the plaintiffs involved; the tariffs in question will remain in force for other importers until July 2026.

It is reported that on February 20, 2026, the US Supreme Court ruled that the Trump administration's related large-scale tariff measures implemented under the International Emergency Economic Powers Act did not comply with legal provisions. Subsequently, the Trump administration turned to previously untested provisions in the Trade Act of 1974 to introduce a new global tariff policy replacing the old one, namely a 10% global tariff on all countries, lasting 150 days.

Following the announcement of this latest ruling, the Trump administration is expected to file an appeal. Responding to related questions on the evening of the ruling's announcement, Trump stated that his team would find alternative ways to advance the relevant policies, and the court's decision did not surprise him.

Currently, the only tariff tool still available to the Trump administration is industry-specific tariffs. Officials have initiated a process to study the feasibility of launching a new round of nationwide tariffs. Importers can now apply for refunds for tariffs previously invalidated by the Supreme Court's ruling. The refund process will be implemented in phases, with the full opening date yet to be specified. If the government takes subsequent action, the calculation and arrival time of refund amounts may be delayed.